Singapore’s benchmark Straits Times Index (STI) has capped a historic year in 2025, climbing to multiple all-time highs and delivering its strongest annual performance in years. By mid-December, the index had risen by roughly 20.1% to 20.8% year-to-date, comfortably outperforming major global benchmarks such as the S&P 500 and reinforcing renewed confidence in Singapore’s equity market.
The rally saw the STI reach a record peak of 4,603.33 in December, after crossing key psychological milestones earlier in the year. The index broke above 4,200 in July and surpassed 4,400 in October, marking a steady upward trajectory driven by both domestic and external tailwinds.
Economic fundamentals provided strong support for the market. Singapore’s Ministry of Trade and Industry revised its 2025 GDP growth forecast upward to around 4.0%, a sharp improvement from the initial projection of 1.5% to 2.5%. The upgrade reflected resilience in trade, manufacturing and services, helping to anchor investor optimism despite global uncertainties.
Corporate performance also played a central role. Heavyweight banking stocks such as DBS Group and OCBC Bank hit record share prices, underpinned by resilient earnings, higher net interest income and robust capital positions. Aggressive shareholder return strategies, including special dividends and share buybacks, further boosted investor appetite for local blue-chip stocks.
Policy initiatives added another layer of momentum. The government’s Equity Market Development Programme, which committed billions of dollars to strengthen the local equity ecosystem, improved market depth and liquidity. In addition, the launch of the iEdge Singapore Next 50 Index drew greater attention to mid- and small-cap companies, broadening participation beyond traditional index heavyweights.
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Several stocks stood out as top performers during the year. DFI Retail Group surged by approximately 72% year-to-date, while Singapore Technologies Engineering and supermarket operator Sheng Siong also delivered strong gains, with Sheng Siong reaching a new all-time high. These advances reflected both company-specific strengths and a broader re-rating of Singapore-listed equities.
Looking ahead, analysts remain cautiously optimistic about the outlook for 2026. While acknowledging the sharp re-rating already achieved, market watchers see scope for further upside, with some projecting the STI could advance toward the 4,880 level. Expectations are anchored on sustained corporate profitability, attractive dividend yields and continued policy support, positioning Singapore’s equity market to remain a relative bright spot in the global investment landscape.
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